What is Chapter 7 Bankruptcy?

There are few types of bankruptcy. Chapter 7 bankruptcy involves personal property. People that declare this type of bankruptcy have often lost their job or are going through a divorce. They are in debt and need the opportunity to start over. Filing bankruptcy can last on a person’s credit report for up to seven years. This can hinder a person who is trying to take out a loan or trying to get a credit card. This is an option for people who feel there are not other options available. But there are other penalties that a person may face. There are added filing fees and court fees that could cost thousands of dollars. Filing paperwork and going to court takes time. Hiring a lawyer to help can cost money. It is best to hire a lawyer, however. Knowing one’s rights is important since there are certain items that a person does not have to lose when declaring bankruptcy.

Other Considerations When Declaring Chapter 7 Bankruptcy

There are other considerations such as classes in debt management that one will have to take after filing for bankruptcy. These classes teach a person how budget their money, how to being to rebuild their credit, and what to watch out for when credit card offers arrive in the mail. After declaring bankruptcy, credit card companies are supposed to stop calling. If they don’t, then they will need to be called by one’s lawyer. This is considered harassment and should not be tolerated. The court should send notification to all credit card companies regarding the bankruptcy. Another consideration is being hired if one loses their job. Even though a person cannot be fired from their current jobs, many companies are conducting credit checks on perspective employees due to jobs that require travel. A person could be turned down for having bankruptcy in their file. Though unfair, it is not illegal.

Filing Chapter 7 is not something that should be taken lightly. Some people think that by filing bankruptcy they are being given a second change. This is not so. Many lives have been ruined for a long time due to bankruptcy. It is not the end of the world, but it does make life a little more difficult. Knowing one’s rights is important. Hiring a lawyer that can explain what is happening and what a person is allowed to keep within the limits of the law is important and worth the money.